External Assets of Resident Enterprises in Palestine Once Again Exceeded Foreign Liabilities in 2013

Recently the PCBS and the PMA published the results of the foreign investment survey of resident enterprises for 2013, which measures the assets of resident enterprises in Palestine abroad (or the total stock of investments by resident enterprises in Palestine abroad, called external assets) and the liabilities of resident enterprises (or the total stock of foreign investments in resident enterprises in Palestine, called foreign liabilities). The results of the survey showed that at the end of 2013 total external assets ($5,791 million) exceeded foreign liabilities ($2,928 million) significantly once again. These two numbers correspond to an increase of about 12% from a year earlier in both categories. As the two figures below show, there exist major differences in the breakdown of external assets and foreign liabilities. While FDI makes up only 3% of Palestinian resident enterprises’ investments aboard, it accounts for more than half of foreign investments in local enterprises.

The table below shows the detailed breakdown of external assets and foreign liabilities at the end of 2013 compared with the end of the previous year.

Table: Distribution of External Assets and Foreign Liabilities of Resident Enterprises in Palestine, 2012 and 2013

2012 ($ millions)

2013 ($ millions)

Change (%)

Total Assets

5,155

5,791

+12.3

Stocks of FDI

133

143

+7.5

Stocks of Portfolio Investments

1,028

1,004

-2.3

Of which Equity Securities

296

145

-51.0

Of which Debt Securities

732

859

+17.3

Stocks of Other Investments

3,330

3,959

+18.9

Of which Trade Credits

7

5

-28.6

Of which Loans

94

38

-59.6

Of which Currency and Deposits

3,229

3,916

+21.3

Of which Other Assets

0

0

n/a

Stocks of Reserve Assets

664

685

+3.2

Total Liabilities

2,625

2,938

+11.9

Stocks of FDI

1,463

1,558

+6.5

Stocks of Portfolio Investments

676

768

+13.6

Of which Equity Securities

676

768

+13.6

Of which Debt Securities

0

0

n/a

Stocks of Other Investments

486

612

+25.9

Of which Trade Credits

0

1

n/a

Of which Loans

43

58

+34.9

Of which Currency and Deposits

443

552

+24.6

Of which Other Assets

0

1

n/a

Source: PCBS and PMA

In terms of the sectoral distribution of FDI and portfolio investments in Palestinian enterprises, the bulk went to financial intermediation ($1,150 million) and services, transport, storage, and internal trade ($1,023 million) (out of combined $2,326 million). Once again, Jordan was the largest investor in Palestinian enterprises in terms of both FDI and portfolio investments with total investments of $1,556 million, followed by Qatar with a total of $230 million.